Investor sentiment, profitability and offer price band: evidence from the Indian IPO market
Article
Article Title | Investor sentiment, profitability and offer price band: evidence from the Indian IPO market |
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ERA Journal ID | 123852 |
Article Category | Article |
Authors | Pensiero, Dom (Author) and Krishnamurti, Chandrasekhar (Author) |
Journal Title | Global Economy and Finance Journal |
Global Economics and Finance Journal | |
Journal Citation | 7 (2), pp. 59-70 |
Number of Pages | 12 |
Year | 2014 |
Place of Publication | Dandenong, Victoria |
ISSN | 1834-5883 |
1834-5891 | |
Web Address (URL) | http://www.gefjpapers.com/static/documents/September/2014/4.%20Dom%20and%20Chandrashekhar.pdf |
Abstract | Offer price band is a crucial component of the book building process in the Initial Public Offering process of a firm. Extant research shows that investor sentiment plays a prominent role in IPO markets. We therefore suggest that investor sentiment plays a significant role in determining the offer price range. The determinants of offer price band have not been studied in the IPO literature. We fill this lacuna by studying the Indian IPO market. We hypothesise that investor sentiment will positively influence offer price band. We also posit that the profitability of a firm will be inversely related to the offer price band. Our empirical tests support these hypotheses. |
Keywords | initial public offering, investor sentiment, offer price band |
ANZSRC Field of Research 2020 | 350202. Finance |
Byline Affiliations | School of Accounting, Economics and Finance |
Institution of Origin | University of Southern Queensland |
https://research.usq.edu.au/item/q2v9x/investor-sentiment-profitability-and-offer-price-band-evidence-from-the-indian-ipo-market
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